Investors are still overweight developed markets — in particular Germany — and underweight very strong economies. India stands out. Investors have missed the boat on this one. The Wisdom Tree India (EPI 44,04 -0,65 -1,45%) exchange traded fund has beat all of the big emerging markets, plus Japan (EWJ 70,92 +0,27 +0,38%), Europe (VGK 66,41 +0,11 +0,17%) and the U.S. (SPY 515,71 +2,85 +0,56%) year-to-date. Yet, according to data compiled by HSBC, India remains below its normal weighting in the index benchmark. It’s above average in sovereign debt and right at average for local currency debt, however.
India is one of their favorite markets for investing right now, HSBC says, from a multi-asset perspective — stocks, bonds, currency. U.S. dollar sluggishness has played to India’s advantage, as well as stable commodity prices for oil and gold especially, key imports for them.
India has been an expensive trade, however, most fund managers we speak with say that Indian valuations make it less attractive. According to fund flow data from EPFR Global, India beats out China, but there is much more money flow heading to Mexico, Russia, Brazil and Turkey, where cowboy hedge funds like what political risk there has done to valuations.
Big underweights for equities so far this year include U.K. (Unfortunately, we could not get stock quote UKX this time.); South Korea (EWY 63,28 +1,10 +1,77%), Brazil (EWZ 31,83 -0,59 -1,82%), France (EWQ 41,41 -0,19 -0,46%), Russia (Unfortunately, we could not get stock quote NYSEARCA: RSX this time.) and Turkey (TUR 36,66 -0,47 -1,27%). India Investing Is Getting Expensive
India Beats China
Investors are still overweight developed markets — in particular Germany — and underweight very strong economies. India stands out. Investors have missed the boat on this one. The Wisdom Tree India (EPI 44,04 -0,65 -1,45%) exchange traded fund has beat all of the big emerging markets, plus Japan (EWJ 70,92 +0,27 +0,38%), Europe (VGK 66,41 +0,11 +0,17%) and the U.S. (SPY 515,71 +2,85 +0,56%) year-to-date. Yet, according to data compiled by HSBC, India remains below its normal weighting in the index benchmark. It’s above average in sovereign debt and right at average for local currency debt, however.
India is one of their favorite markets for investing right now, HSBC says, from a multi-asset perspective — stocks, bonds, currency. U.S. dollar sluggishness has played to India’s advantage, as well as stable commodity prices for oil and gold especially, key imports for them.
India has been an expensive trade, however, most fund managers we speak with say that Indian valuations make it less attractive. According to fund flow data from EPFR Global, India beats out China, but there is much more money flow heading to Mexico, Russia, Brazil and Turkey, where cowboy hedge funds like what political risk there has done to valuations.
Big underweights for equities so far this year include U.K. (Unfortunately, we could not get stock quote UKX this time.); South Korea (EWY 63,28 +1,10 +1,77%), Brazil (EWZ 31,83 -0,59 -1,82%), France (EWQ 41,41 -0,19 -0,46%), Russia (Unfortunately, we could not get stock quote NYSEARCA: RSX this time.) and Turkey (TUR 36,66 -0,47 -1,27%).